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View Full Version : priced town homes. surprised at larger companies prices.


Sharps_lawn&landscaping
01-20-2013, 12:25 PM
I bid a street of town homes recently. I have about five guys that work with me during the year and know what it takes to cover cost. Just on the mowing I had figured it would take three men two hours if everything went just so. With that being said they want a price per cut broke down. I came in at 270 but about four other larger companies were coming in around 200,230,240,285. I really felt like it should have been more around the 300 range. I feel a lot of larger groups have low balled the commercial prices down over the years and the hoa's want premier service at a cheap price. We'll see what happens

jrs.landscaping
01-20-2013, 02:06 PM
You guys were all in the ballpark. If someone bid $50 per mow I would call that lowballing.

Sharps_lawn&landscaping
01-20-2013, 02:20 PM
Well there was two in the 190 range but it use to pay above 300. I knew someone that lived in there. But I figured I would be the highest . Just hate to think three years ago it paid x amount and now pays a lot less if you figured it on a certain amount of visits. It could add up to 2000 less a year. Just saying I wish no one would lower the costs since times are more expensive to run.

jrs.landscaping
01-20-2013, 02:31 PM
It's like that everywhere. I've been underbid by 90k before. The companies bid wouldn't have covered my payroll to do the job, apparently it didn't cover his because he gave up the contract. These things work themselves out over time.

clydebusa
01-20-2013, 02:34 PM
Yelp pretty cheap, you came in at $35.00. No much meat on the bone at that.

Sharps_lawn&landscaping
01-20-2013, 02:57 PM
No i came in at 45.00 per man hour. You really never know until you do the work how long it will take. I'd rather be a little high than figure it cheap. I've been down the road pricing things to close, you will end up being out of business.

clydebusa
01-20-2013, 03:10 PM
Yelp you are right. When I figure price I will do reverse math. I figure $1 hour for this and $1 hour for that and I just figured yours on $10 hour for extra's leaving $35 each for man hours.

Sharps_lawn&landscaping
01-20-2013, 03:37 PM
It isn't bad money. So by what you are saying is if i was paying 35 an hour for this and that and it took two hours that would be 70.00 paid out. Leaving me with a 200 dolllar profit in two hours. How would 100.00 an hour be no meat on the bone? I pay my guys any where from 10 to 14 an hour. Realistically, with labor and fuel costs you would be looking at around 40.00 an hour cost operating. Thats why it is important to try and bunch your properties on a good route with little drive time.

Jimslawncareservice
01-20-2013, 03:47 PM
Man, I thought I was low at 54 hour for a property like that. I just bid another at that price and I know I'm less than the current lco. I won't know til march or so when they have their meeting.
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grandview (2006)
01-20-2013, 04:35 PM
Your making back room profit on this job. How many lawns and miles would you put in to make the same amount? One stop and less fuel costs driving around.

ed2hess
01-20-2013, 06:58 PM
It isn't bad money. So by what you are saying is if i was paying 35 an hour for this and that and it took two hours that would be 70.00 paid out. Leaving me with a 200 dolllar profit in two hours. How would 100.00 an hour be no meat on the bone? I pay my guys any where from 10 to 14 an hour. Realistically, with labor and fuel costs you would be looking at around 40.00 an hour cost operating. Thats why it is important to try and bunch your properties on a good route with little drive time.

The problem could be that a big company looks for a profit of around 8%. What do you expect? I am talking about Brinkman and TruGreen kind of size.

Sharps_lawn&landscaping
01-20-2013, 08:15 PM
Ha 8 percent I'd cry. So if you had a 100 dollar cut you would make 8 bucks . That's slave labor

jbell36
01-20-2013, 08:38 PM
yeah that's terrible...i'm dealing with that right now that is even less than 8%, actually about half that...they are absolutely killing the commercial market...they are a very large company out of a larger city around here...they drive 45 minutes just to get here then start their day with 5 guys (per crew), then head back...i guess having 30 crews making a 4% profit would make the owner money, not much though...

i don't understand how it's worth it...first of all, you have to pay 5 guys 1.5 hours of drive time and pay for that additional fuel every day...secondly, what happens when something breaks down or you need to buy new equipment?

skorum03
01-20-2013, 08:52 PM
We're talking 280 per mowing right? Excuse me for being new. haha


YardBros Outdoors
www.yardbros.com

ed2hess
01-20-2013, 09:01 PM
Ha 8 percent I'd cry. So if you had a 100 dollar cut you would make 8 bucks . That's slave labor

Would it seem better if I said you could make $20,000 on a $250,000 dollar business? It is a struggle for a mid size business to get to 25% profit. You are cheery picking(as some say) hoping that none of the mid size business move into your area. Not being critical just the way it is. Now often the big companies fail at these condo and HOA and that is where we try to focus our attention on.

Sharps_lawn&landscaping
01-20-2013, 10:31 PM
Right now i'm at a point where i can cherry pick what i want. I get what your saying. This is a really small contract compared to some i have. I bid against a lot of different size companies. I guess the only way for the larger companies to keep expanding their profits quickly would be to price low and wedge as many people out as possible. Theres plenty to go around but when they loose contracts and you come up on some of them, its just a pain to convince people to pay more like they had been previously before the landscaper that priced it low came in.

orangemower
01-21-2013, 10:35 AM
Right now i'm at a point where i can cherry pick what i want. I get what your saying. This is a really small contract compared to some i have. I bid against a lot of different size companies. I guess the only way for the larger companies to keep expanding their profits quickly would be to price low and wedge as many people out as possible. Theres plenty to go around but when they loose contracts and you come up on some of them, its just a pain to convince people to pay more like they had been previously before the landscaper that priced it low came in.

welcome to the world of lawn care.

Sharps_lawn&landscaping
01-21-2013, 11:15 AM
Yea what fun

grassman177
01-21-2013, 02:13 PM
commercial is totally dead, resi soon to follow, and is already stale in some respects

LandFakers
01-21-2013, 03:07 PM
I bid on a commercial property once, I was over $200 more than the guy who won it, he went out of business that same year and I got the job the following season. It all works out in the end

ed2hess
01-21-2013, 08:28 PM
Right now i'm at a point where i can cherry pick what i want. I get what your saying. This is a really small contract compared to some i have. I bid against a lot of different size companies. I guess the only way for the larger companies to keep expanding their profits quickly would be to price low and wedge as many people out as possible. Theres plenty to go around but when they loose contracts and you come up on some of them, its just a pain to convince people to pay more like they had been previously before the landscaper that priced it low came in.

There are a few companies in our area that have a strategy to build the business and then sell. So as long as they meet payroll they are fine.
To them they need customers and a lot of them. One company sold out then came back in 7 years and building business again.

32vld
01-21-2013, 09:48 PM
Ha 8 percent I'd cry. So if you had a 100 dollar cut you would make 8 bucks . That's slave labor

Most people here are small. Many solo or they run one truck with 1 or 2 helpers.

The solo LCO that does 40 lawns a week clearing $8 profit each is going to make $320 for himself.

The big company that has same work per truck at the same profit for example has 10 trucks makes the owner $3,200 for the week.
The big company that has 20 trucks makes $6,400 for the week for the owner.

There is more then one way to value what a good profit is.

Sharps_lawn&landscaping
01-21-2013, 10:45 PM
Most people here are small. Many solo or they run one truck with 1 or 2 helpers.

The solo LCO that does 40 lawns a week clearing $8 profit each is going to make $320 for himself.

The big company that has same work per truck at the same profit for example has 10 trucks makes the owner $3,200 for the week.
The big company that has 20 trucks makes $6,400 for the week for the owner.

There is more then one way to value what a good profit is.


Well you let me know how that 8 percent works for you. Ill be honest i think its a bunch of stupidity. For all the trouble you would have to go through with the mind set of clearing so little profit. So if you did ONE MILLION dollars in revenue, lets just say grossed. Then all you got out of all that headache was 80,000 dollars? You really think thats a good philosophy. When most solo operations make half of that amount. I understand it would work for someone like trugreen but im referring to operations that employ 4 to 50 people.

Sharps_lawn&landscaping
01-24-2013, 11:52 AM
And of course they chose the cheapest group. Called me yesterday. Doesn't happen all the time but I had a feeling it would.

ed2hess
01-24-2013, 08:53 PM
And of course they chose the cheapest group. Called me yesterday. Doesn't happen all the time but I had a feeling it would.

We always ask them to allow us a chance to match. Sometimes they give
you the details and find that other bids don't include all the things you bid. Sorry it didn't work out....hard to lose bids.

Weekend cut easymoney
01-24-2013, 10:11 PM
Well you let me know how that 8 percent works for you. Ill be honest i think its a bunch of stupidity. For all the trouble you would have to go through with the mind set of clearing so little profit. So if you did ONE MILLION dollars in revenue, lets just say grossed. Then all you got out of all that headache was 80,000 dollars? You really think thats a good philosophy. When most solo operations make half of that amount. I understand it would work for someone like trugreen but im referring to operations that employ 4 to 50 people.

The part that they don't tell you is the big million dolar operation also is building equity in trucks, equipment ...worth and that dude likly has guys to do most everything so he can take vacations etc....they also take low margins so they can make the big bucks on the extras.....

herler
01-25-2013, 12:44 AM
Sounds to me like a bunch of lazy bums, anyone could have bid that at $30 and been King of the Hill but kids today, they don't want to get out there and work for a dollar anymore, guess they'd rather sit at home playing the Xbox3 but then again it all evens itself out over time.

32vld
01-25-2013, 01:55 PM
Well you let me know how that 8 percent works for you. Ill be honest i think its a bunch of stupidity. For all the trouble you would have to go through with the mind set of clearing so little profit. So if you did ONE MILLION dollars in revenue, lets just say grossed. Then all you got out of all that headache was 80,000 dollars? You really think thats a good philosophy. When most solo operations make half of that amount. I understand it would work for someone like trugreen but im referring to operations that employ 4 to 50 people.

After paying all costs and clearing $320 as a solo is not going to work for me. Though is works for Brickman and the other large outfits.

clydebusa
01-25-2013, 01:58 PM
Right now i'm at a point where i can cherry pick what i want. I get what your saying. This is a really small contract compared to some i have. I bid against a lot of different size companies. I guess the only way for the larger companies to keep expanding their profits quickly would be to price low and wedge as many people out as possible. Theres plenty to go around but when they loose contracts and you come up on some of them, its just a pain to convince people to pay more like they had been previously before the landscaper that priced it low came in.

The big company are the Wal-Mart's of the competition

trooper8870
01-27-2013, 12:43 AM
I have stopped trying to figure out how everybody else bids their jobs. You can take 5 LCO's, put them in a room with the same bid packet and all 5 will come back different. Alot different. I just bid a commercial facility. I was given the bid from another LCO to reference. Even though the price was obscured, I could still see what he quoted. I was $8,000.00 a year over his bid and was nervous at that. There is no consistancy in what we do. From the guys doing it for beer money and trying to clear $10.00 per hour to the guys who do this for a living that try to clear $60.00 per hour, there is just know consistancy in the pricing. I have given up on commercial properties. Folks lose their minds when it comes to bidding them. In my opinion, it does not matter if you are cutting 20 one acre residential lots or one 20 acre commercial facility. It is still hot, dirty and very tiring work. Expenses are expenses. Charge them for what you do, and have enough profit in it to make it worth doing. By the way, the big commercial properties are not going to fix or replace your equipment when it breaks!!

Sharps_lawn&landscaping
02-24-2013, 11:39 PM
true but i have found commercial properties are easier to deal with. Unless your cutting for a bunch of old people. A lot less headache of when it has to be cut and so forth.